Monday, July 14, 2008 weekly review

Another down week, another down set of Stockcharters?

Just as a heads up - I used to have a top-15 Stockchart list, but it has now drifted into the quagmire of the 'long-tail'. I maintain the front-page daily and anything from page 5 is current stocks.

Maurice Walker kicks the week off. I was interested to read his opinions on the ADX with respect to volatility:

The VIX had a spike to 30 today which is encouraging, but when buyers bought the sell-off the VIX closed right at the 2007 broken trendline. The VXN got a spike high to 35 which is extreme territory, just as 30 is for the VIX.

We continue to get whipsaws and extreme volatility. As I stated yesterday the ADX is above both DI lines on the S&P 500 and the DJIA. Until the ADX peaks, the volatility will continue. However, buyers are coming in on steep sell-offs, which leads me to believe that the MACD on the averages will soon get a bullish cross. The daily index charts continue to have rising slopes on their histogram indicators.

He sees a huge rally soon, but only when everyone who wants to sell has

Many longs are growing weary and felling worn out, as they are tired of waiting for a reversal. A reversal will occur, but it will only be the patient who make money in this market. When a reversal candlestick pattern occurs, wait for confirmation.

Backtest of the Transports in a head-and-shoulder reversal pattern?

Joe has taken a calm view to the week's events....

Will Exxon break? I think not..

But has the energy sector bottomed?

Yong Pan added one new bullish signal, but the overall picture remains negative:

Awaiting extremes in volatility and ATR:

Ted Burge is seeing a swing towards point-n-figure 'buy' signals:

Some facts you need to know. More stocks to X's this morning than to O's. Weighted indices vs one vote per stock.

If you want to see this in context and view two new videos, go to the front page at:

Richard Lehman - are we ready for a short covering rally (but not a real bottom rally)?

7/11 -- Some interesting magic occurred amidst today's craziness. The Dow stopped precisely on its upper line during the rumor rally. The SPX hit its lower line perfectly and bounced. The RUT broke its short term downchannel (the first index to do so!) And the XLF hit its long term line on the one-year chart and bounced. Also, VIX spiked. The Fannie & Freddie business may have dampened the market enough to create a Bear Stearns type bottom. If the Fed holds them up (which it virtually has to do in one way or another), we might get another relief rally going. You saw how explosive the short covering was today for a brief while. IndyMac went belly-up after the close and that could weigh on Monday, but the market is very oversold and is vulnerable to short covering at any time.

7/10 -- I was able to simplify a couple of charts today like RUT and XLF to show well defined short term downtrends that encompass even yesterday's blip. In fact, they both actually predicted that blip would hit a wall where it did. The bottom line is short term downchannels are as long as any since I've started charting and still very much intact. But the Dow and XLF may still find support from long term line touches right where they are currently.

7/9 -- So much for the bounce. At least those who follow the magic knew that there was a big line above the Dow and sure enough it repelled the index three times! Also, I got the blue minichannel up early in the day and when it broke (the Dow was down about 80 points by then) at least we knew to pull the plug. One thing about watching these minis is they get you out quickly on market turns you may not have expected. Anyway, we are left with some false breakouts on indexes like the SPX, so now we'll need a day or so to figure out where the current channels really are on the short term charts. (Likely it will be a slope change but still heading downward, but we'll see.) Otherwise, almost all long term channels and minis are still very much intact.

Jack Chan 'sell' signal in Oil Services Holders?

Robert New 7-year support test?

Dr. Declan Fallon, Senior Market Technician, the free stock alerts, market alerts and stock charts website